We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Hilltop Holdings (HTH) Stock Down Despite Q4 Earnings Beat
Read MoreHide Full Article
Hilltop Holdings Inc.’s (HTH - Free Report) fourth-quarter 2023 earnings of 44 cents per share beat the Zacks Consensus Estimate of 40 cents. The bottom line improved 12.8% from the prior-year quarter.
Results benefited from increased non-interest income and reduced expenses. Also, the solid profitability and capital ratios, along with lower provisions, provided support. However, a fall in net interest income (NII), coupled with a decline in loans and deposit balances, acted as undermining factors. This led investors to be bearish on the stock, which lost 1.44% since the earnings release last week.
Net income attributable to common stockholders was $28.7 million, up 12.2% year over year.
In 2023, earnings per share were $1.69, which increased 5.6% from the previous year and beat the Zacks Consensus Estimate of $1.50. Net income available to common stockholders was $109.6 million, which declined 3.1% year over year.
Revenues & Expenses Decline
Quarterly net revenues were $290.2 million, which declined 1% year over year. The top line missed the Zacks Consensus Estimate of $295 million.
In 2023, total revenues were $1.2 billion, down 7.4% year over year. The top line was in line with the Zacks Consensus Estimate.
NII declined 9.9% to $111.2 million. Our estimate was $113.9 million.
Net interest margin (NIM) (taxable-equivalent basis) was 2.98%, down 26 basis points. We had expected NIM to be 2.96%.
Non-interest income was $179 million, up 5.4% year over year. The metric was in line with our estimate.
Non-interest expenses declined 1% to $250.8 million. We projected a total non-interest expense of $253.1 million.
As of Dec 31, 2023, net loans held for investment were $8 billion, down 1.5% sequentially. Total deposits were $11.1 billion, down marginally. Our estimates for net loans held for investment and total deposits were $7.9 billion and $10.6 billion, respectively.
Credit Quality: A Mixed Bag
In the fourth quarter of 2023, Hilltop Holdings recorded a provision of $1.3 million, which decreased 65.2% from the prior-year quarter.
As of Dec 31, 2023, non-performing assets as a percentage of total assets were 0.45%, which increased from 0.20% reported in the year-ago quarter.
Profitability & Capital Ratios Improve
Return on average assets at the end of the reported quarter was 0.75%, which increased from the prior-year quarter’s 0.63%. The return on average stockholders’ equity was 5.46%, which rose from 4.99%.
The common equity tier 1 capital ratio was 19.31% as of Dec 31, 2023, which increased from 18.23% in the corresponding period of 2022. The total capital ratio was 22.33%, representing a rise from the year-ago period’s 20.98%.
Share Repurchase Update
During 2023, the company repurchased 1.64 million shares for $5.1 million.
Also, HTH authorized a new stock repurchase program through January 2025, where it is authorized to buy back approximately $75 million worth of shares.
Dividend Hike
Hilltop Holdings announced a quarterly cash dividend of 17 cents per share, marking a hike of 6% from the prior payout. The dividend will be paid out on Feb 28, 2024, to its stockholders of record as of Feb 12, 2024.
Our Take
Hilltop Holdings finds support from its efforts to improve non-interest income. Additionally, manageable expense levels and lower provisions for credit losses will aid financials. However, a decline in NII and lower loans and deposit balances are near-term concerns.
Hilltop Holdings Inc. Price, Consensus and EPS Surprise
Hancock Whitney Corp.’s (HWC - Free Report) fourth-quarter 2023 adjusted earnings per share of $1.26 beat the Zacks Consensus Estimate of $1.08. Adjusted earnings per share, however, compared unfavorably with $1.65 earned in the year-ago quarter.
HWC’s results were negatively impacted by a decline in both NII and non-interest income. Further, a slight decrease in loan balances and an increase in expenses and provisions acted as spoilsports.
WaFd, Inc.’s (WAFD - Free Report) first-quarter fiscal 2024 (ended Dec 31) earnings of 85 cents per share surpassed the Zacks Consensus Estimate of 72 cents. However, the bottom line declined 26.7% year over year.
WAFD’s results primarily benefited from the rise in other income and steady loan balance. In the reported quarter, the company did not record any provision for credit losses. However, a fall in NII and an increase in other expenses acted as spoilsports.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Hilltop Holdings (HTH) Stock Down Despite Q4 Earnings Beat
Hilltop Holdings Inc.’s (HTH - Free Report) fourth-quarter 2023 earnings of 44 cents per share beat the Zacks Consensus Estimate of 40 cents. The bottom line improved 12.8% from the prior-year quarter.
Results benefited from increased non-interest income and reduced expenses. Also, the solid profitability and capital ratios, along with lower provisions, provided support. However, a fall in net interest income (NII), coupled with a decline in loans and deposit balances, acted as undermining factors. This led investors to be bearish on the stock, which lost 1.44% since the earnings release last week.
Net income attributable to common stockholders was $28.7 million, up 12.2% year over year.
In 2023, earnings per share were $1.69, which increased 5.6% from the previous year and beat the Zacks Consensus Estimate of $1.50. Net income available to common stockholders was $109.6 million, which declined 3.1% year over year.
Revenues & Expenses Decline
Quarterly net revenues were $290.2 million, which declined 1% year over year. The top line missed the Zacks Consensus Estimate of $295 million.
In 2023, total revenues were $1.2 billion, down 7.4% year over year. The top line was in line with the Zacks Consensus Estimate.
NII declined 9.9% to $111.2 million. Our estimate was $113.9 million.
Net interest margin (NIM) (taxable-equivalent basis) was 2.98%, down 26 basis points. We had expected NIM to be 2.96%.
Non-interest income was $179 million, up 5.4% year over year. The metric was in line with our estimate.
Non-interest expenses declined 1% to $250.8 million. We projected a total non-interest expense of $253.1 million.
As of Dec 31, 2023, net loans held for investment were $8 billion, down 1.5% sequentially. Total deposits were $11.1 billion, down marginally. Our estimates for net loans held for investment and total deposits were $7.9 billion and $10.6 billion, respectively.
Credit Quality: A Mixed Bag
In the fourth quarter of 2023, Hilltop Holdings recorded a provision of $1.3 million, which decreased 65.2% from the prior-year quarter.
As of Dec 31, 2023, non-performing assets as a percentage of total assets were 0.45%, which increased from 0.20% reported in the year-ago quarter.
Profitability & Capital Ratios Improve
Return on average assets at the end of the reported quarter was 0.75%, which increased from the prior-year quarter’s 0.63%. The return on average stockholders’ equity was 5.46%, which rose from 4.99%.
The common equity tier 1 capital ratio was 19.31% as of Dec 31, 2023, which increased from 18.23% in the corresponding period of 2022. The total capital ratio was 22.33%, representing a rise from the year-ago period’s 20.98%.
Share Repurchase Update
During 2023, the company repurchased 1.64 million shares for $5.1 million.
Also, HTH authorized a new stock repurchase program through January 2025, where it is authorized to buy back approximately $75 million worth of shares.
Dividend Hike
Hilltop Holdings announced a quarterly cash dividend of 17 cents per share, marking a hike of 6% from the prior payout. The dividend will be paid out on Feb 28, 2024, to its stockholders of record as of Feb 12, 2024.
Our Take
Hilltop Holdings finds support from its efforts to improve non-interest income. Additionally, manageable expense levels and lower provisions for credit losses will aid financials. However, a decline in NII and lower loans and deposit balances are near-term concerns.
Hilltop Holdings Inc. Price, Consensus and EPS Surprise
Hilltop Holdings Inc. price-consensus-eps-surprise-chart | Hilltop Holdings Inc. Quote
Hilltop Holdings currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Performance of Other Banks
Hancock Whitney Corp.’s (HWC - Free Report) fourth-quarter 2023 adjusted earnings per share of $1.26 beat the Zacks Consensus Estimate of $1.08. Adjusted earnings per share, however, compared unfavorably with $1.65 earned in the year-ago quarter.
HWC’s results were negatively impacted by a decline in both NII and non-interest income. Further, a slight decrease in loan balances and an increase in expenses and provisions acted as spoilsports.
WaFd, Inc.’s (WAFD - Free Report) first-quarter fiscal 2024 (ended Dec 31) earnings of 85 cents per share surpassed the Zacks Consensus Estimate of 72 cents. However, the bottom line declined 26.7% year over year.
WAFD’s results primarily benefited from the rise in other income and steady loan balance. In the reported quarter, the company did not record any provision for credit losses. However, a fall in NII and an increase in other expenses acted as spoilsports.